**WTMS Blog Today = What’s up in Mortgage Today (AM) – 08/28/2025**

Mortgage-backed securities are showing mixed signals today as investors navigate a complex rate environment. The 10-year Treasury yield eased to 4.23%, down 0.01 percentage points from yesterday’s session, providing some relief to bond markets. This slight decline in Treasury yields typically translates to modest improvements in MBS pricing, though the moves remain relatively contained. UMBS (Uniform Mortgage-Backed Securities) markets are experiencing cautious trading as participants assess the impact of recent economic data. Lower rate expectations are forcing fixed-income investors to diversify their portfolios, with mortgage-backed securities potentially benefiting from this rotation. The GNMA market is following similar patterns, with secondary market activity remaining steady but subdued. Mortgage rates hit another 2025 low yesterday at 6.51% for 30-year fixed loans, creating renewed optimism in the origination space.

This incremental improvement reflects the broader bond market’s response to softening economic indicators and tempered inflation expectations. Lenders are cautiously optimistic about increased application volume as rates approach more attractive levels for potential borrowers. The mortgage origination business continues to face headwinds despite the recent rate improvements. Industry professionals are managing reduced pipeline volumes while preparing for potential market shifts if rates continue their gradual decline.

Real estate sales activity remains sluggish, with buyers still hesitant due to affordability concerns even as rates show signs of moderating. Market participants are closely watching upcoming economic releases that could influence Federal Reserve policy decisions. The bond market’s recent stability suggests investors are positioning for a potential shift in monetary policy direction. However, volatility remains elevated as traders navigate conflicting signals about the economy’s trajectory.

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